DraftKings and FanDuel Not In Serious Merger Talks

Daily fantasy sports sites DraftKings and FanDuel are not in serious merger negotiations, contrary to a Bloomberg report from yesterday.

Multiple sources close to the situation tell Fortune that the speculation is likely being driven by investment banks, and that the companies’ are primarily focused on resolving regulatory issues like the current ban on daily fantasy in New York, and not doing a deal.

“I don’t know exactly why this is coming up now,” says one source. “Obviously a lot of people have talked about the two companies merging, and certainly it’s been discussed at least informally by the companies and the investors, but there hasn’t been any movement toward actually having it happen.”

Fortune had argued for such a merger last fall, believing that a tie-up would allow the companies to redirect cash from marketing against each other, and toward their shared legal challenges. One big sticking point, besides the general animosity between the two startups, has been who would lead a combined DraftKings-FanDuel. Sources have long said that FanDuel CEO Nigel Eccles would insist on being CEO of a combined company, while DraftKings CEO Jason Robins would prefer the combined boards of directors to decide.